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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 213.50+6.2%Dec 19 3:59 PM EST

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To: mas_ who wrote (256545)10/8/2008 2:18:43 PM
From: Elmer PhudRead Replies (2) of 275872
 
Buffett warns on investment 'time bomb'
"Derivatives generate reported earnings that are often wildly overstated and based on estimates whose inaccuracy may not be exposed for many years"

"Large amounts of risk have become concentrated in the hands of relatively few derivatives dealers ... which can trigger serious systemic problems"

The rapidly growing trade in derivatives poses a "mega-catastrophic risk" for the economy and most shares are still "too expensive", legendary investor Warren Buffett has warned.


futureblind.com


Berkshire Part 2: Selling PutsBy Max Olson | March 7th, 2008 at 11:45 am | buffett, finance

Buffett has pulled it off again. He’s made a creative, favorable bet that may pay off handsomely for long-term Berkshire shareholders.

Over the past year, Berkshire Hathaway sold put options on the S&P 500 and three foreign indices. Expiration of these puts range from 12 to 20 years out, and Berkshire collected $4.5 billion in premiums. Unlike regular puts, these are exercisable only at their expiration dates. On those dates, Berkshire makes a payment only if the index has lost money over the period of the option.
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